Updated with info on RFP process and clarification of unrelated accounting changes
Population health management company Healthways has replaced Ernst & Young after almost 12 years with fellow Big Four accounting firm PricewaterhouseCoopers.
The move by Franklin-based Healthways became effective June 27, the company said in a recent filing with the U.S. Securities and Exchange Commission. Company officials said the hiring of PwC came after an RFP process that included four national firms — including E&Y — and was a "market check" after more than a decade with the same auditors. The company recently also installed a new board audit committtee chair, Kevin Wills.
The population health management company paid Ernst & Young $1.3 million in fiscal year 2013 for various accounting services. The CPA firm had been Healthways' auditor since November of 2002, when it took over from Deloitte & Touche. A value for PricewaterhouseCoopers' winning bid was not disclosed in SEC filings.
Healthways' switch also comes after the company earlier this year disclosed a so-called "material weakness" in how it recognized revenues from non-standard contracts. In its March quarterly report, executives said the issue was resolved prior to their first-quarter earnings report and that the company then adopted new documentation procedures for such contracts. Company officials said there was no connection between that issue and the switch to PwC.
Shares of Healthways (Ticker: HWAY) were down slightly to $17.00 Tuesday. Year to date, they're up nearly 11 percent.
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